Facts regarding HST
For your easy reference, here are certain facts regarding the Harmonized Sales Tax (HST) which came into effect July 1, 2010.
- HST is charged at 13% = 5% Goods and Services Tax + 8% Provincial Sales Tax
- HST applies to all goods and services including real property.
- HST is generally applicable for purchase of newly constructed homes and condominiums if the closing is after July 1, 2010. However, if the Agreement of Purchase and Sale was signed on or before June 18, 2009 no HST is applicable (GST still applies). For new homes and condominiums if the Agreement of Purchase and Sale was signed after June 18, 2009 there is no HST payable (only GST applies) if the purchase price of the property does not exceed $400,000.00. There is a$24,000.00 rebate on all newly constructed homes and condominiums. There is a graduated rebate on purchase prices between $400,000.00 and $500,000.00. Beyond $500,000.00 the full HST is payable on the portion of the purchase price over $500,000.00.
- No HST is applicable on newly constructed condominiums if interim occupancy occurs before July 1, 2010 and the final closing is after July 1, 2010.
- HST applies to all commercial property transactions.
- HST does not apply to the price of resale homes or on residential rents.
- HST is applicable in resale transactions only on the commission of the realtor payable by the seller if the Agreement is signed on or after July 1, 2010. However, if the Agreement was signed before July 1, 2010 and 90% of the realtor’s services were provided before July 1, 2010 then no HST applies; only GST is applicable.